Claim terms glossary

Actual cash value (ACV)

The replacement cost minus depreciation. Often the first payment on a claim.

Additional living expense (ALE)

Coverage for extra costs of living elsewhere while your home can't be lived in, such as a hotel or meals. Also called Loss of Use.

Adjuster

The person who investigates the claim and decides what the policy pays. The carrier's adjuster works for the insurance company.

Appraisal

A process in many policies for settling a disagreement about the amount of loss.

Carrier

The insurance company that issued your policy.

Claim number

The number the carrier assigns to your claim. Put it on everything you send.

Contents

Your personal belongings, such as furniture, clothing and electronics, as opposed to the building.

Declarations page

The summary page of your policy: coverages, limits, deductible and policy period.

Deductible

The part of the loss you pay before the policy pays.

Depreciation

The reduction in value for age and wear. Under many policies, some of it is paid back after repairs are done (recoverable depreciation).

Dwelling

The main structure of your home. Usually Coverage A.

Endorsement

A change or addition to your policy. Also, signing the back of a check.

Mitigation

Steps to stop more damage, such as water removal, drying, board-up and tarping.

Mortgagee

Your mortgage company, often named on insurance checks. See Mortgage company checks: how repair funds get released.

Overhead and profit (O&P)

A general contractor's added costs when several trades are needed.

Policyholder

The person or business named on the insurance policy.

Proof of loss

A statement, often signed and sworn, of what was lost and how much you're claiming.

Public adjuster

A licensed professional you can hire to prepare and present your claim, usually paid a share of the claim payment.

Replacement cost value (RCV)

The cost to repair or replace with materials of like kind and quality, before depreciation.

Reservation of rights

A letter saying the carrier is still investigating and may decide some or all of the loss isn't covered.

Scope of loss

The list of damage and the repairs needed.

Supplement

A request for more money for items missed in the first estimate or found during repairs.

Xactimate

The estimating software most carriers and contractors use to price repairs.